Company Presentation – 1Q 2014 Resultsindofoodagri.listedcompany.com/newsroom/indo290414.pdf · Presentation Outline 1 Business Overview 2 Plantation Highlights ... 74% 61,053 32%

Company Presentation – 1Q 2014 Results30 April 2014

Integrated Agribusiness with Leading Brands

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Presentation Outline

11 Business OverviewBusiness Overview

22 Plantation Highlights Plantation Highlights

33 Financial Highlights Financial Highlights

44 Strategies and ExpansionStrategies and Expansion


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Section 1 – Business Overview


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Integrated and Diversified Agribusiness

Capturing value across the entire supply chainUpstream Downstream

R&D / Seed Breading Plantations Mills

Edible oils and fats Distribution

33m oil palm seeds p.a.

Develops sugar varieties

33m oil palm seeds p.a.

Develops sugar varieties

22 palm oil mills at capacity 5.6m MT p.a.

2 sugar mills/refineries in Indonesia at capacity 2.2m MT p.a. ; 1 sugar mill in Brazil at capacity 3.8m MT p.a.

4 crumb/ 3 sheet rubber factories

22 palm oil mills at capacity 5.6m MT p.a.

2 sugar mills/refineries in Indonesia at capacity 2.2m MT p.a. ; 1 sugar mill in Brazil at capacity 3.8m MT p.a.

4 crumb/ 3 sheet rubber factories

Leading market share in Indonesia branded cooking oil and margarine marketsStrong sales and marketing expertise and extensive distribution network, serving ~370,000 retail outlets in IndonesiaLeverage on Indofood’s 1,100 stock points5 refineries at capacity: 1.4m MT p.a.

Leading market share in Indonesia branded cooking oil and margarine marketsStrong sales and marketing expertise and extensive distribution network, serving ~370,000 retail outlets in IndonesiaLeverage on Indofood’s 1,100 stock points5 refineries at capacity: 1.4m MT p.a.

* As of 31 Mar 2014

Diversified crops IndonesiaPalm: 240,075Ha

Production FY13CPO: 810,000MTPK: 187,000MTIndonesiaCane: 12,166HaBrazilSugar Cane: 45,600Ha

Rubber: 21,603Ha

Diversified crops IndonesiaPalm: 240,075Ha

Production FY13CPO: 810,000MTPK: 187,000MTIndonesiaCane: 12,166HaBrazilSugar Cane: 45,600Ha

Rubber: 21,603Ha


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Total Nucleus Oil Palm Planted Area

New Plantings ≈ 62,000 Ha in Last 5 Years (2009 – 2013)

Oil Palm Planted Area - Nucleus

132,56068%

155,40076%

158,16373%

176,10576%

177,099 74%

61,05332%

49,66424%

58,67427%

54,81324%

62,822 26%

2009 2010 2011 2012 2013

Mature Immature

in Ha

193,613 205,064 216,837 230,918 232,931

Oil Palm New Planting - Nucleus

10,96314,072 13,884 13,383

9,791

2009 2010 2011 2012 2013

in Ha


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2009

• Acquired plantation land bank of 10,000 hectares in South Sumatra, Indonesia

• Incorporated a new subsidiary to own barges, tugboats and operate a shipping logistics business

• Raised Rp730 billion from 5-year Indonesian Rupiah Bonds and Islamic Lease-based Bonds

2010

• Divested 8% or 109,521,000 shares in Lonsum for a cash consideration of Rp1.3 trillion, of which, 3.1% was sold to PT SIMP and 4.9% was sold to the public

2011

• Listed PT SIMP on the main board of the Indonesia Stock Exchange and raised net proceeds of Rp3.35 trillion from an IPO of 3,163,260,000 new ordinary shares

2012

• Acquired a 26.4% interest in Heliae, a development stage algae technology solutions company for US$15 million

2013

• Acquired a 79.7% interest in MPM, which in turn owns the SAL Group that holds three industrial forest plantation concessions for Rp330 billion (US$34.0 million), totalling 73,330 hectares in East Kalimantan

• Acquired a 50% stake in CMAA for cash consideration of BRL143.4 million (US$66.6 million), the Group’s first overseas investment into the sugar, ethanol and co-generation industry in Brazil

• Established a S$500 million Euro Medium Term Note Programme

• Formed FP Natural Resources Limited (FPNRL), a joint venture between First Pacific Company Limited (70% stake) and IndoAgri (30% stake) , to invest 34% in Roxas Holdings Inc. (Roxas), the largest integrated sugar business in the Philippines. The cash consideration for IndoAgri was US$17.4 million

Key Corporate Actions in Last 5 Years (2009-2013)


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CMAA acquisition completed in June 2013. Key rationale:Expansion of our presence into the sugar, ethanol and co-generation industry in BrazilSuperior technical know-how and best practices from Brazil that can be transferredback to IndoAgri’s Indonesia sugar operationsEarnings accretive investmentwith a strong local partner in an expanding business

Key Highlights:1 sugar cane factory with a total cane crushing capacity of 3.8m MT p.a.; supplementedby ethanol and co-generation plantsAs of Mar 2014, planted area was 45,600 Ha, of which 52% - owned by CMAA.In 2013, harvested cane were 3.0 million MT, producing 187,000 MT of raw sugar and137,000 m3 ethanol

Overseas Expansion – CMAA Brazil (Minas Gerais Province)


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Geographical Presence

UnitCapacity p.a(MT FFB) Unit

Capacity p.a(MT Dry Rubber) Unit

Capacity p.a(MT Dry Rubber) Unit

Capacity p.a(MT Sugar Cane) Unit

Capacity p.a(MT CPO)

SIMP 11 3,348,000 ‐ ‐ ‐ ‐ 2 2,160,000 5 1,425,000 Lonsum 11 2,295,000 4 42,720 3 11,100 ‐ ‐ ‐ ‐ CMAA ‐ Brazil ‐ ‐ ‐ ‐ ‐ ‐ 1 3,800,000 ‐ ‐ Group 22 5,643,000 4 42,720 3 11,100 3 5,960,000 5 1,425,000

RefineryFacilities

Palm Oil Mill Crumb Rubber Facility Sheet Rubber Facility Sugar Mill & Refinery


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Section 2 – Plantation Highlights


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Planted Area

Oil Palm Average age ≈ 13 years

(1) As at 31 Mar 2014, the Group has ≈ 86,560 Ha of planted oil palm plasma area. Out of which, 188 Ha are new planting in 1Q14

(2) 1Q14 new plantings for oil palm at 1,158 Ha vs. 1,500 Ha in 1Q13

Mature oil palm increased by 6,917 Ha in 1Q14

24% 29%16%

5% 4%7%

47% 35%65%

24% 32%12%

Group SIMP Lonsum

Immature 4-6 years 7-20 years > 20 years

240,705 Ha 150,722 Ha 89,983 Ha

In Ha 31 Mar 2014 31 Dec 2013 Change

IndonesiaPlanted Area 293,770 292,768 1,002

Planted Oil Palm(1) 240,705 239,921 784- SIMP 150,722 150,076 646- Lonsum 89,983 89,845 138

Planted Other crops 53,065 52,847 218 Rubber 21,603 21,759 (156)- SIMP 4,409 4,409 - - Lonsum 17,194 17,350 (156)Sugar cane - SIMP 12,166 11,645 521 Cocoa & tea - Lonsum 3,237 3,384 (147)Industrial timber - SIMP 16,059 16,059 -

Brazil - CMAASugar cane 45,600 42,517 3,083 - Company 23,838 20,755 3,083 - Third Party 21,762 21,762 -

(2)


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Oil Palm Plantation Highlights

1Q14 1Q13 YoYGrowth FY13

PRODUCTION

Mature Area (Ha) 183,286 177,591 3% 177,099

FFB ('000 MT) 958 844 13% 3,761 - Nucleus ('000 MT) 706 628 12% 2,895 - External ('000 MT) 252 216 16% 866

CPO ('000 MT) 210 182 15% 810

PK ('000 MT) 47 42 11% 187

PRODUCTIVITY

FFB Yield – Nucleus (MT/Ha) 3.9 3.5 16.3

CPO Yield – Nucleus (MT/Ha) 0.9 0.8 3.6

CPO Extraction Rate (%) 22.5 22.2 22.1

PK Extraction Rate (%) 5.1 5.2 5.1

FFB nucleus production growth driven by higher production from South Sumatra and KalimantanSugar milling and harvesting season commences in April


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Oil Palm Production Trends

Growth

FFB - Nucleus1Q14 YoY : 12%

FFB - External1Q14 YoY : 16%

CPO1Q14 YoY : 15%

176 205 225 232

190 210 239 241

182 174 209

245 210

1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14

'000 MT

CPO Production

589 675

759 774

630 703

825 815

628 637

778 852

706

203 238 268 291 255 257 294 328 216 161 205

284 252

1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14

'000 MT

FFB Production

FFB - Nucleus FFB - External

45% 55% 45% 55% 44% 56%


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Section 3 – Financials Highlights


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Results Summary

• EBITDA excluding biological asset gains/(losses) and forex gains/(losses)

Financial HighlightsA strong set of 1Q14 results on strong recovery in averageselling prices (ASP), particularly CPO up 43% and PalmKernel up 107%, and foreign currency gainTotal revenue (before elimination of inter-segment sales)up 29% yoy on higher sales from both Plantation and EOFdivisions1Q14 EBITDA up 45% yoy on strong profit contributionfrom Plantation Division1Q14 attributable profit up 70% on yoy

Operational HighlightsAchieved FFB nucleus production of 706,000 tonnes in1Q14, up 12% yoy on higher production from SouthSumatra and KalimantanCPO production up 15% to 210,000 tonnes mainly due toboth higher nucleus production and higher purchases ofFFB from external parties

450

654

1Q13 1Q14

Rp bnEBITDA*

+45%

3,097 3,171

5821,557

Rp bnRevenue

Inter-segment

External

+2%

+29%

1Q13 1Q14

3,679

4,728


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Sales Volume

In '000 MT 1Q14 1Q13 YoYGrowth FY13

Plantation

CPO 213 208 2% 864

Palm Kernel 45 45 (1%) 190

Sugar 10 10 1% 76

Rubber 4.1 3.7 9% 15.9

Oil Palm Seeds ('million) 1.7 4.9 (66%) 17.9

Edible Oils & Fats

Cooking Oil, Margarine and Coconut Oil 189 182 4% 790


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Sales Volume TrendGrowth

CPO1Q14 YoY : 2%

PK1Q14 YoY : (1%)

Edible Oils & Fats1Q14 YoY : 4%

180 202 203 187 206 217

196 189 182 215 198 195 189

1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14

'000 MT

Edible Oils & Fats - Sales Volume

187 194 204

244

182

220 217 209 208 225

195

235 213

40 44 50 59 49 45 56 53 45 43 46 56 45

1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14

'000 MTCPO and PK - Sales Volume

CPO PK


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Average Selling Price (ASP) Trend

Growth

CPO 1Q14 YoY : 43%

PK 1Q14 YoY : 107%

Rubber1Q14 YoY : (12%)

41,839 38,769 36,417 36,897

32,784 28,649 26,625 25,755 27,052

22,230 22,933 24,549 23,890

1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14

Rp / kg

Rubber - ASP

8,286 7,697 7,404 6,944 7,484

8,089 7,459

6,227 6,273 6,666 7,373

8,399 8,994

6,838 5,936

3,933 3,269

4,158 4,160 3,534

2,917 2,806 3,084 3,574

4,338

5,810

1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14

Rp / kgCPO and PK - ASP

CPO PK


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Financial Summary

* EBITDA excluding biological asset gains/(losses) and forex gains/(losses)** Operating profit excluding biological asset gains/(losses)

In Rp Bn 1Q14 1Q13 YoY Growth FY13

Sales 3,171 3,097 2% 13,280

EBITDA* 654 450 45% 2,614

Operating profit** 574 302 90% 1,631

Gain/(loss) arising from changes in FV of biological assets

- - 62

Net profit 342 153 123% 921

Attributable profit 182 107 70% 523

Attributable profit exclude biological assets gain/(loss)

182 107 70% 476

EPS (fully diluted) - Rp 128 74 73% 366

EBITDA margin 21% 15% 20%

Operating profit margin 18% 10% 12%

Net profit margin 11% 5% 7%

Attributable profit margin 6% 3% 4%

Attributable profit exclude biological assets gain/(loss) margin

6% 3% 4%


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Segmental Results

(1) Net effects arising from elimination of unrealised profit of inter-division inventories, SFRS adjustment and regional office costs.

In Rp Bn 1Q14 1Q13 YoY Growth FY13

Sales

Plantations 2,433 1,743 40% 8,450

Edible Oil & Fats 2,295 1,935 19% 8,627

Elimination & Adjustments (1,557) (582) 168% (3,798)

Total 3,171 3,097 2% 13,280

EBITDAPlantations 819 243 237% 2,263

EBITDA % 34% 14% 27%Edible Oil & Fats (7) 201 (104%) 393

EBITDA % (0.3%) 10% 5%

Elimination & Adjustments(1) (158) 6 n/m (41)

Sub-total 654 450 45% 2,614

Net Forex Gains/(Losses) 86 (4) n/m (201)

Total 739 446 66% 2,414

CPO stock at refineries increased from 34,000 MT @ Dec’13 to 66,000 MT @ Mar’14 in anticipation of the rampup in production for the peak season. A major portion of CPO stock was from own internal plantation, and therelated unrealised profit amounted to Rp134 billion, which would likely to be realised in the next quarter.


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By Geographical Location

1Q14 1Q13

Indonesia remained our dominant market with 87% of sales derived from the domestic market, mainly comprised of edible oil product, palm product, palm seeds and sugar.

Exports to the United States and Europe mainly comprised of copra-based product and rubber.

While exports to Asia, Africa, Middle East & Oceania comprised of edible oil products.

External Revenue Breakdown

Indonesia, 87.4%

Asia, 6.2%

Europe, 4.0%America, 0.5%

Africa, Middle East & Oceania,

1.9%

Indonesia, 86.8%

Asia, 6.0%

Europe, 4.4%America, 1.2%

Africa, Middle East & Oceania,

1.6%


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Financial Position

* Total equity includes shareholders funds and minority interests.

Balance Sheet (In Rp Bn) 31-Mar-14 31-Dec-13TOTAL ASSETS 38,962 37,705Cash 3,845 3,803TOTAL LIABILITIES 15,895 14,872Interest Bearing Debt 9,501 8,795TOTAL EQUITY* 23,067 22,833

Net Debt / EBITDA Ratio (Annualised) 2.16x 1.91xNet Debt / Total Equity Ratio 0.25x 0.22xNet Assets Value per Share - in Rupiah 9,989 9,876Net Assets Value per Share - in SGD 1.10 1.09

Cash Flow (In Rp Bn) 1Q14 1Q13

Net Cash Flow generated from Operating Activities 231 260Net Cash Flow used in Investing Activities (908) (1,015)Net Cash Flow generated from Financing Activities 805 65Net Increase (Decrease) in Cash & Cash Equivalents 128 (690)Net Effect of Changes in Forex (86) (1)

Sub-total 42 (691)Cash & Cash Equivalent - Beginning 3,803 5,082Cash & Cash Equivalent - Ending 3,845 4,391


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Section 4 – Strategies and Expansion


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IndonesiaFocus organic expansion on new plantings of oil palm and sugarplantations in Indonesia

Expansion of plantation production facilitiesOne 45MT/hour new mill in East Kalimantan due for completion in 3Q2014Two 45MT/hour new mills in Kalimantan due for completion in 2015Expanding one existing mills in South Sumatra from 40 MT/hour to 60MT/hour due for completion in 3Q 2014Constructed a 150MT/day PKO plant in Riau in 1Q 2014Additional RSPO Certified CPO of 43,000 tonnes, bringing total CSPOproduction to 291,000 tonnes

Expansion of downstream facilitiesConstructing a 200 MT/day margarine plant at Tanjung Priok in 2014Constructing one 330,000 MT/year new refinery in Dumai due forcompletion in 2015

Outside IndonesiaCMAA in Brazil has expanded its cane crushing capacity from 3.0 million to3.8 million MT/year in April 2014

Strategies and Expansion – 2014


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Section 5 – Appendix


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Corporate Structure

Note:(1) IndoAgri is 60.4% effectively owned by Indofood(2) Indofood has a direct interest of 6.5% in SIMP(3) Based on total number issued shares, excluding the following shares held in treasury as of 31 Mar 2014

• IndoAgri : 30,500,000• SIMP : 208,273,400• Lonsum : 2,900,000

59.5%

73.0%10.2%

Roxas

50.0%


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Production Breakdown

1Q14 1Q13 YoYGrowth FY13

PRODUCTIONMature Area - SIMP (Ha) 107,443 102,257 5% 102,155 - Lonsum (Ha) 75,844 75,333 1% 74,944

FFB - Nucleus - SIMP ('000 MT) 397 357 11% 1,644 - Lonsum ('000 MT) 308 271 14% 1,250

- External - SIMP ('000 MT) 136 115 18% 454 - Lonsum ('000 MT) 125 114 10% 477CPO - SIMP ('000 MT) 110 93 18% 414 - Lonsum ('000 MT) 100 89 13% 396

PK - SIMP ('000 MT) 23 22 6% 93 - Lonsum ('000 MT) 24 21 17% 94

PRODUCTIVITY

FFB Yield – Nucleus - SIMP (MT/Ha) 3.7 3.5 16.1 - Lonsum (MT/Ha) 4.1 3.6 16.7CPO Yield – Nucleus - SIMP (MT/Ha) 0.8 0.8 3.4 - Lonsum (MT/Ha) 1.0 0.8 3.9

CPO Extraction Rate - SIMP (%) 21.9 21.5 21.3 - Lonsum (%) 23.2 23.0 22.9

PK Extraction Rate - SIMP (%) 4.6 5.0 4.8 - Lonsum (%) 5.6 5.4 5.5


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This presentation was prepared solely and exclusively for the parties presently being invited for the purpose ofdiscussion. Neither this presentation nor any of its content may be reproduced, disclosed or used without the priorwritten consent of Indofood Agri Resources Ltd.

This presentation may contain statements that convey future oriented expectations which represent the Company’spresent views on the probable future events and financial plans. Such views are presented on the basis of currentassumptions, are exposed to various risks, and are subject to considerable changes at any time. Presentedassumptions are presumed correct at the, and based on the data available on the, date at which this presentation isassembled. The Company warrants no assurance that such outlook will, in part or as a whole, eventually bematerialized. Actual results may diverge significantly from those projected.© Indofood Agri Resources Ltd. All rights reserved.

Indofood Agri Resources Ltd.8 Eu Tong Sen Street#16-96/97 The Central

Singapore 059818Tel: +65 6557 2389

Fax: +65 6557 2387

www.indofoodagri.com

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Company Presentation – 1Q 2014 Resultsindofoodagri.listedcompany.com/newsroom/indo290414.pdf · Presentation Outline 1 Business Overview 2 Plantation Highlights ... 74% 61,053 32%